Kantar Health explored issues around both the business and care delivery aspects of the dynamic oncology environment in the United States through our survey of 150 independent community-based and 80 hospital-owned or -affiliated oncology practices (the surveys were fielded in the first quarter of 2016). In this article, we will look at aspects of the increasing role of IDNs in cancer care and how care delivery in an IDN may differ from an independent community practice.

It will come as no surprise to readers that the business of oncology in the United States remains dynamic. Thirty five percent of independent community oncology practices in our survey engaged in some form of business association within the past two years; the majority were affiliations with a hospital/IDN (Fig. 1).

In addition 22% of oncology practices are considering affiliation with an IDN in the next 24 months, while only 5% are considering dissolving an existing arrangement (Fig 2).

The reasons offered for the IDN affiliations were aligned with market opportunities, such as strengthening integrated care capabilities, capturing patient volume, assuring the practice’s viability in the face of declining reimbursement, and reducing administrative burden. Access to 340B pricing plays a smaller role from the oncology practice perspective (Fig 3).

Over the last several years we have seen that oncologists are growing more comfortable being part of an IDN, reporting a mean satisfaction score of 4.1 (on a 5-point scale) for 2016, up from 3.7 and 3.9 in 2014 and 2015, respectively. This comfort can be explained in part by the services increasingly offered by the IDN and valued by oncologists (Fig 4).

In addition to more practices associating with IDNs, we are seeing an increase in the volume of patients being treated by IDN-associated practices. Oncology patient volume continues to grow overall due to diagnosis at earlier stages, increased incidence, better survival, and the capability to see more patients, but this volume is flowing disproportionately to hospital-affiliated and owned practices (Fig 5).

Hospital/IDN-owned and -affiliated practices may be capturing the patients as a result of investment in staff and infusion chairs at a much greater rate than we see in independent community practices (Fig 6). As a result, while infusion revenue is growing in IDNs (Fig 7), oncologists and practice managers identify declining infusion revenue as a key contributor to decreased profitability in independent community practices.

Independent community practices remain highly dependent on drug margins and administrative and evaluation/management (E&M) fees – in contrast, IDN-affiliated practice revenue is balanced across a more diverse range of income sources (Fig. 8). Of note, IDN practices in our survey report 23% of their revenues come from novel reimbursement arrangements (e.g., quality or compliance bonuses, shared savings), versus only 9% of community practice revenue from these sources.

IDN-affiliated practices achieve this balanced revenue stream in part because they are much more likely to be participating in a patient-centered medical home (PCMH) or accountable care organization (ACO) arrangement (Fig. 9).

Beyond adopting novel reimbursement mechanisms, IDNs are experimenting with diversification into the role of payer; one-fourth of IDN oncologists in our survey report their IDN also operates as a health plan. These IDNs with health plans are actively expanding and managing their cancer programs – they are statistically significantly more likely than IDNs without health plans to:

Be actively expanding their cancer programs

Have more infusion sites

Encourage the use of the hospital pharmacy to fill patient prescriptions

Expanded participation in novel reimbursement arrangements, and potentially the impact of operating as a health plan, will put IDN-affiliated practices on the forefront of the oncology reimbursement evolution and, subsequently, changes in care decision-making triggered by the changing environment and the nature of working in the more complicated and layered management structure.

Emerging IDN Influence on Cancer Care

With more and more cancer patients receiving their care through an IDN-affiliated or owned practice, and those practices on the leading edge of changes in capabilities, reimbursement and business models, how might this shift toward oncology care through IDNs be affecting patient treatment?

Our research suggests three trends that may be differentially influencing cancer care decision making in IDN-owned or -affiliated practices: increasingly centralized management of oncology, focus on cost effectiveness catalyzed by novel reimbursement, and adaptations to increased patient involvement in care planning.

1. IDN centralized management of affiliated oncology practices

We see this centralized management being implemented through increasing CPOE/decision support tools to help select drugs, the use of pathways with management controls (e.g., step requirements), a centralized drug acquisition and/or formulary. Less than 20% of IDN practice respondents reported no IDN mechanisms that affected prescribing (Fig. 10).

Decision support tools, centralized drug formularies and pathways are most often used to direct IDN oncologists toward preferred therapies (Fig. 11).

Pathways are key mechanism by which IDNs may influence an oncologists treatment decisions, and IDN oncologists are more likely to be exposed to pathways than are their independent community practice colleagues (Fig 12).

About 40% of IDN oncologists with pathways in 2016 report mandatory participation requirements that affect treatment options (up from just 20% in 2015). While consequences of prescribing off pathway are largely administrative, over a quarter of IDN oncologists may not be reimbursed if they fail to comply (Fig. 13).

Almost half (46%) of IDN oncologists report participating in an ACO in 2016 (up from 40% in 2015), affecting one-third of their patients on average. ACO-participating IDN practices are more likely to focus on cost-effective treatments, reduction in redundant care, and the quality of life for their ACO patients (Fig. 14).

3. Adaptation to increased patient involvement in care planning

While IDN practices most often direct patients with cost concerns to financial support, they do so less frequently than independent community practices. The IDN oncologists are also increasingly looking to less costly drug alternatives in response to affordability issues (Fig. 15). Of note, the 26% response indicating use of less costly drug options in the IDN is up from 13% in 2015.

IDN oncologists are more likely to have end-of-life planning discussions with patients (frequently triggered by changes in patient status) (Fig. 16) and to have these discussions result in reductions in the use of therapeutic options for most of these patients (Fig. 17).

Only 7% of IDN oncologists having end-of-life planning talks with their patients report no reduction in patients’ use of therapeutic alternatives, versus 31% of independent community oncologists who state they are not reducing treatment based on end-of-life planning.

Conclusion

The continuing affiliation between community oncology practices and IDNs is resulting in more and more cancer patients being treated in an IDN setting. This trend will continue given economic incentives, the shift to integrated care delivery models, IDN investment in oncology capabilities, and growing oncologist acceptance of working within an IDN.

IDNs are structurally different from community practices, and these differences are influencing traditional cancer care delivery and decision making. In IDNs we are seeing increasingly centralized management of oncology, a focus on cost effectiveness catalyzed by novel reimbursement, and more flexibility in adapting treatment in response to patient involvement in care planning. Given the growing importance of the IDN environment in oncology care, it behooves us all to understand how this shift will change cancer care delivery and patient care.

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About the Contributors

Deni Deasy Boekell is Senior Director in the Oncology Commercial Strategies group at Kantar Health.

Kantar Health is a leading global healthcare advisory firm and trusted advisor to the world’s largest pharmaceutical, biotech, and medical device and diagnostic companies. It combines evidence-based research capabilities with deep scientific, therapeutic and clinical knowledge, commercial development know-how, and marketing expertise to help clients launch products and differentiate their brands in the marketplace.

Kantar Health provides both the research and consulting services you need to support your business decisions across the product lifecycle for cancer therapies. Our oncology expert status has been earned because of the proprietary material we publish on cancer epidemiology, trends in oncology market access, oncology pipeline potential and treatment trends that help our clients with their business issues.